Sterling strengthened against the euro and US dollar yesterday after solid economic data in the UK and further turmoil in the euro zone left the pound looking relatively good to investors. The National Institute of Economic and Social Research released data yesterday that showed that UK economic growth held steady at 0.5% in the 3 months to October. The figures helped calm fears that the economy could be heading back for recession. With the focus on Italy, the UK is perceived to have a much tighter grip on austerity measures than many of its counterparts across the globe. This is helping to boost demand for sterling so call in now for a live exchange rate.

In the euro zone, Rome has taken over from Athens as the focus of the euro zone debt crisis. Italian borrowing costs continued to surge, which means that the country could require a bailout that Europe cannot afford. Italian Prime Minister Silvio Berlusconi lost his parliamentary majority in a budget vote yesterday increasing pressure on him to resign his position. If he does resign, we could see the euro regain ground against the US dollar and sterling as many feel a change of leadership is what is needed. Call in now for a live exchange rate.

In the USA, stock markets were unchanged yesterday following the Italian vote that left the political situation looking rather cloudy in Europe – especially given the size of repayments that Italy has to make next year and the rate at which its borrowing costs are shooting up. Elsewhere, economic confidence dropped which is to be expected. Out later today, Fed chairman Ben Bernanke speaks so call in now for a live rate.

Elsewhere, the Canadian dollar fell overnight against its major counterparts as investors pulled back holdings in the riskier currency. Market turmoil caused by the euro zone is good for sterling against the more minor currency pairings e.g. the South African rand. Call in now to ensure you take advantage.


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